Wednesday, 24 July 2013

PayPoint IMS



Provides clients with specialist consumer payment transaction processing and settlement across a wide variety of markets: (energy pre and post-payment, telecoms, housing, water, transport, e-commerce, parking and gaming) through its retail networks, internet and mobile phone channels. I have a holding in my income portfolio (epic code: PAY).



PayPoint issued their interim management statement today.  They stated that transactions processed for the 91 day period since year end were 180 million, this was up 6% on a pro-rata basis comparing it to the equivalent 91 day period last year. Revenues of £51 million were up 3% on a pro-rata basis.

Their JV with Yodel in Collect+ saw volumes increase by 72% to over 2.8 million transactions in the period. They have introduced a new standard two day delivery service in addition to the economy 3-5 day service and increased the number of sites offering Collect+ since the year end by 202 to 5,457.

Net cash at 30 June was £40.8m, compared to £39.6m at 31 March 2013. The final dividend of £13.7m and the special dividend of £10.1m are due for payment on 25 July 2013.

Finally they stated that overall trading for the period to 30 June 2013 was in line with market expectations, taking seasonality of trading into account.

Since I last posted on PayPoint on 23 May, the shares have increased over 21% to 1110p so that they appear to be fully valued at 22 times this year's earnings and 20 times next year's.  To justify this valuation on a discounted cash flow basis, they will need to grow free cash flow by 13% pa for the next 10 years and I have then assumed 2.5% growth in perpetuity and discounted the resultant cash flows by 11%. 
 

No comments:

Post a Comment